Optimism about the strength of Wall Street, where the Dow Jones Industrial Average moved fleetingly past 10,000, helped the London market early in yesterday's session. But ironically it was as the Dow made its dash to 10,000 that London moved in the opposite direction, with the FTSE 100 index eventually finishing 4.9 off at 6,201.9.

The FTSE 250 gave a similar performance, closing only 0.8 ahead at 5,519.7, having been up 18.4 at best, in mid-morning. Meanwhile, the FTSE SmallCap marched on, posting a 9.2 gain at 2,375.8.

An early surge had taken the FTSE 100 up 62.8 to a session high of 6,269.6 as investors anticipated the Dow's move. The overnight resignation of the entire European Commission did not seem to have much impact on the market, with analysts pointing out that the Commission neither set interest rates nor determined fiscal policy.

Buyers moved back into the market yesterday, regaining some of the confidence lost during the previous two sessions when profit-taking and the biggest-ever block trade, involving Cable and Wireless, drained much liquidity. The telecoms sector, which suffered badly on Monday, rallied yesterday, with Colt Telecom in the lead.

A burst of take-over activity in the small-caps gave a lift to sentiment.

On the downside, the list of profit warnings grew longer.